The legislation would amend the Fair Credit Reporting Act to require the inclusion of credit scores with the free annual credit reports available to consumers each year at www.annualcreditreport.com.

Federal law requires lenders to provide consumers with an automatic free copy of their credit score if they’ve been turned down for credit or if they got a higher interest rate on a loan or unfavorable terms on a credit card.

The Cohen/Sanders bill would expand upon that provision of the Wall Street Reform and Consumer Protection Act to provide all consumers with an annual credit score to complement their free annual credit report.

Currently, “consumers may be tricked into buying inaccurate credit scores from competing credit agencies and/or lured by the false promise of a ‘free’ credit score into signing up for credit monitoring services costing up to $200 per year,” Cohen and Sanders said in a press release announcing their proposed legislation.

The measure also would mandate that the free annual credit score received by consumers is a reliable score actually used by lenders, rather than an “informational score” of unknown reliability, they said.

“It is an injustice that small medical bills, which are often confusing and inaccurate, can prevent an otherwise creditworthy consumer from qualifying for a mortgage, refinancing their home or buying a car,” said Plano mortgage banker Rodney Anderson, who’s been sounding the alarm about how medical debt can wreck a credit record.

Supporters of the legislation said medical debt is unique in that it’s not typically reported to credit bureaus by health care providers, even when bills are paid in a timely manner and paid in full.

Anderson said medical bills are typically reported to the credit bureaus only after they’ve been assigned to debt collectors.
That means that credit bureaus are receiving incomplete and biased information because they don’t receive data reflecting positive payment history, only the negative, supporters of the legislation said.